Free Trial

Credit Agricole See BoJ Comments Making Markets Wary of Hawkish Dec Shift

JPY
  • On the moves in USD/JPY (triggered today by recent rounds of BoJ communique resulting in speculation surrounding BoJ policy normalisation on top of the poorly received 30-Year JGB auction), Credit Agricole specifically flag Himino’s comments yesterday where he hinted that a shift to positive rates would not lead to economic catastrophe. Adding to the theme, Ueda overnight discussed the options for raising rates when the BoJ eventually decides to do so.
  • They write that the fact that the Governor and Deputy Governor have begun thinking and talking in public about an exit from NIRP has led the market to become nervous about a potential hawkish shift by the BoJ at the Dec19 meeting.
  • Until then, global yields are likely to be the stronger driver of the JPY, especially US non-farm payrolls on Friday as well as US and Eurozone CPI data and the FOMC and ECB meetings next week, and also warn that GDP and labour earnings data are unlikely to add to the case for the BoJ ending NIRP.

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.